USDOLLAR failed yet again at the upper parallel from the Schiff fork off of the March high. Pay attention to 11940, which is 2 legs down from the 9/10 high and the 61.8% retrace of the rally from the 9/1 low, for support. This is also near the 8/19 low and top side of the line that crosses highs in August (magenta line).
The US dollar advanced against major currencies in early trading on Thursday. A positive economic outlook from the Federal Reserve and a shift to tolerating higher inflation boosted Treasury yields, in turn supporting the greenback.
AUDUSD continues to bang against the center line of the channel from the 6/15 low. Action since the 9/9 low is overlapping, brutal, and clearly corrective. Below .7250 would now constitute a bearish break of the channel from the 6/15 low and shift focus to the full channel extension, which intersects the key .7064 level in the middle of next week.
USDSEK dipped to 8.6844 on on 9/10 before turning up. I’m viewing that low as a ‘higher low’ within the bullish cycle from the 9/1 low. Price closed slightly above channel resistance from the March high today. Strength above 8.8050 would complete a head and shoulders bottom and set an objective at 9.0150.
WYCKOFF DISTRIBUTION SCHEMATIC The last 2 trading days have been awfully quiet so now is a good time for some educational yet applicable content. I have copies of Wyckoff schematics hanging on the wall in my office. Google Richard Wyckoff if you are not familiar with his work. I was looking at the distribution schematic…
The most bearish time of the year for equities is now through October 9th. 9/10 – QQQ pushed slightly above the noted 279 before turning down. The next level of interest is the long term parallel (magenta line) near 257. The chart with volume studies below highlights some important observations. First, VWAP from the high was resistance today. Second, the importance of 237.50 (February high) is magnified by VWAP from the March low.
My working assumption is that a B wave triangle ended today at 1975.20 (exactly the 8/3 low) in gold. I am bearish against today’s high and looking for weakness lower in a C wave towards 1800 or so by the end of the month.
GBP/USD fell to its lowest levels since July 28th on Wednesday, extending losses from the recent yearly high made on September 1st. The same day, the UK government published its Internal Market bill, outlining a plan to breach the pledges in the EU Withdrawal Agreement.
USDOLLAR has yet to break above 12087 and the rally has failed so far a the upper parallel from the Schiff fork off of the March high. I’m still leaning towards action since 7/31 as a base that price will work higher from. Watch for support now near 11973.